Final Copy

2015
MelissaGibsonID# 000330911
ProjectDevelopment&Analysis
1/1/2015
National Stability Report

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National Stability Report 2015
Table of Contents
Introduction………………………………………………………………………………………..2
Columbia……………………………………………………………………………………….3 – 7
Political Climate……………………………………………………………………………………3
Economics……………………………………………………………………………………….....4
Legal Climate………………………………………………………………………………...…5 – 6
Social Climate…………………………………………………………………………………...….7
Political Climate………………………………………………………………………………....8 - 9
Indonesia……………………………………………………………………………………...8 – 12
Economics………………………………………………………………………………………...10
Legal……………………………………………………………………………………………...11
Social……………………………………………………………………………………………...12
Bibliography………………………………………………………………………………….13 - 14

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Introduction
Expanding a business into a foreign country can have great advantages and
disadvantaged to their success. Companies must take into consideration a
great deal of information to understand if the move may be right for them.
Expanding to other countries occurs for many developmental reasons such
as labour and work force issues, a desire to reach new markets, to lower
costs and increase cash flow. The stability of the political and social climate
has a significant effect on the investment of the expansion and the success
of your business. Columbia and Indonesia are both up and coming
countries that offer a positive outlook into the future. I have outlines the
political, social and legal climate for both countries and any concerns that
this expansion may face.

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Columbia
Political Climate
Columbia is run by a presidential system of government. The
president is elected for a term of four years, which can be
renewed once, and appoints the government. This government
is approved by the Congress and legislative powers are led by
the House of Representatives, which holds 163 members and
the Senate, which holds 102 members. Columbia has been
divided into 31 departments and district and those departments are run by governors that are also
elected.
The current President today is Juan Manuel Santos Calderon. President Calderon was born in
Bogota on August 10, 1951. He is married to Maria Clemencia Rodrigues and has three children;
Martin (21), Maria Antonia (19), and Estaban (16). He was a cadet of the Navy Academy in
Cartagena, the Chief of the Columbian delegation, a recent Designate to the Presidency and
Columbia’s first Foreign Trade Minister, the Minister of Finance & National Defense. He studied
Economics and Business Administration at the London’s School of Economics, Harvard University
and the Fletcher School of Law and Diplomacy. He also founded Columbia’s largest political party
the Partido de la U in 2005, and created the Good Government Foundation. When he was a
journalist he was the Deputy Director of the newspaper El Tempo and a columnist. During that
time he was awarded the King of Spain prize. He was also the President of the Freedom of
Expression Commission for the Inter American Press Association (IAPA). Juan Calderon has

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published several books such as The Third Way, which was co-written by the former British Prime
Minister Tony Blair, and the book Check on Terror.
President Calderon received the largest votes during the first round of the presidential election. He
was elected for his first four year term from August 7, 2010 to August 7, 2014. During his first
campaign he promised national unity that would carry out the transition of Democratic Security to
Democratic Prosperity. After a successful term as President Calderon decided to run for a second
term and was given approval to run again for presidential election. Calderon won the vote by
50.95% in the second round of the election.
Although Columbia is a parliamentary democracy there are still concerns surrounding corruption
and irregularities. Claims of corruption within the election itself have been made with incidents such
as candidates being threatened to pull out. The biggest concern is the battle against FARC, the
revolutionary armed forces of Columbia, and the ineffective drug war policy. Reports do show that
negotiation for peace between FARC and the government look promising, which could end a 50
year old conflict that has claimed thousands of lives. If negotiations can be met the economy of
Columbia is expected to boom and that can divert $13 billion away from defense and into
infrastructure and allowing future foreign
investments.
Economics
Columbia has ranked 28th
for economic freedom
for the 2015 index, which put them one point
higher than last year. Columbia scored their
highest rating in history for 2015 and has shown
improvements in 6 of the 10 economic freedoms.
The diminished threat from FARC, open
economy and the government reform programs
will open the country further to trade,
investments, and financial flows. Mauricio
Cardenas was able to keep his job as Minister of Finance for a second term due to the investment
boom and the country’s economic growth of 6.4% in the first quarter.
Much of Columbia’s economy is built off of the agricultural industry with a large variety of crops
grown such as bananas, cotton, sugarcane, oil palm, tobacco, beans, grains, flowers, temperate-zone
fruit and vegetables, and coffee Columbia’s largest market and biggest contributor to their economic
health. Columbia also relies on the sale of minerals such as petroleum, natural gas, coal, iron, nickel,
gold, copper, emeralds, and platinum. These exports bring in approximately $59.96 billion a year.
Although Columbia’s expected GDP growth has already been reduced from 4.8% to 4.2% it is still
expected that they will still continue to develop.

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The average monthly salary is $692, which totals to $8,304 a year. Columbia ranks 54 of 72
countries on the global pay scale. Although this standard is low it’s higher than Mexico’s average
salary of $609.
The average Columbian worker has seen an increase in benefit from the heightened cost of labour,
although that has reduced the attraction to Multinational Corporation into the country. Overall 81%
of average Columbian workers have job satisfaction, 5% are very satisfied and 14% are dissatisfied
with their job. Columbia’s unemployment rates have been the lowest in 14 years and have been
steadily declining since 2013.
Legal Climate
Supreme Court
Structure
Civilian
Superior Judiciary
Council
ncil)
Administrative
Council of State
Constitutional
Constitutional
Court
Special
Supreme Court of
Justice

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The Colombian Constitution 1991 is the source of all legislation and overrides all other forms of
judge-made law etc. It is based on the Spanish law and follows a criminal code based on US
procedures.
All levels of court have judges that have been chosen by their peers and serve and 8 year term. The
Supreme Court of Justice has 23 judges and has the highest jurisdiction over civil, family, labor,
commercial, and criminal cases. The Council of the State has 27 judges and is the highest court of
administrative law and takes appealsfrom departmental administrative courts and some national
officials. The Constitutional Court has 9 judges and rather than being nominees of the Superiors
Judicial Council they are nominees of the President, the Supreme Court, and the Council of State.
They are responsible for the constitutional validityof laws approved by the legislative branch. The
Superior Judicial Council has two chambers; administrative and jurisdiction and disciplinary and
consists of 13 members that are selected by the three highest courts and by Congress from nominees
of Executive for an 8 year term.
Columbia has been well known for the production of cocaine since the 1980’s with Pablo Escobar.
Fortunately due to the strong efforts of both the government and law enforcement Columbia has
seen a 60% drop in cocaine production. Violent crimes, especially murder, has been the biggest
concern in Columbia with a murder rate of 30.8 per 100,000 population and only a 2.7% rate for
solved homicides. Bogota once known in the 90’s as one of the most violent cities in the world sees
approximately a crime rate of 19 per 100,000 for murder each year. Cali has seen an increase of
violent crimes and murder since 2011 from 62 to 71 murders per 100,000. According to Columbia’s
most influential magazine has about 1,700 assassins working for various groups in the city. Although
these numbers are high Columbia has shown a decline in violence and murder over the years.
The Columbian National Police (CNP) if often overworked and tends to lack sufficient resources to
deter crime. The CNP can take up to 15 minutes to respond to an emergency. Although they have
police and military personnel, referred to as Centro de Atencion Immedietas (CAIs), posted at
kiosks and random acts of thefts and violence on roads and intersections still occur without police
interruption.
Lower
Court
Structure
Ordinary, civil, family,
commercial, criminal
Administrative Indigenous Jurisdiction Peace, minor criminal
and civil matters

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Social Climate
Columbia is full of heritage and culture and is a very diverse country. With ethnic groups that
ranging from Mestizo (58%), Caucasian’s (20%), mulatto’s (14%), black (4%), mixed black-
American’s (3%), and Amerindian’s (1%). Columbian’s ranked 3 out of 151 countries on the Happy
Planet Index reflecting high life expectancy, 73.7 years, relatively high levels of well-being and
moderate ecological footprint. Despite the stats surrounding happiness and life expectancy a large
portion of Columbians live poorly (23 million) or below the extreme poverty levels (6 million).
Approximately 47% of the population lives below the poverty line.
With a decline in corruption, and increase in crime fighting the Columbian population has a positive
outlook and encourages foreign business into their country.

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Indonesia
Political Climate
The Indonesian Political System

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The Indonesian politicalsystem consists of three branches the executive,legislative,
and judicial. The executive branch consists of the President,the Vice President,and
the cabinet.The legislative branch is the People’s Consultative Assembly (MPR) and
consists of the People’s Representative Council(DPR) and the Regional
RepresentativeCouncil(DPD).The DPD consists of132 members that oversees 33
provinces and stands for a five year term. The judiciary system is the independent
Supreme Court.
The highest political institution is an elected MPR and convenes every 5 years to
approve state policies. The President is responsible to the MPR. The legislative
institutions consist ofthe MPR and the DPR.
Jokowi Widodo was born June 21, 1961 in Surakarta, CentralJava, Indonesia.Widodo
served as governor of Jakarta from 2012-2014.In 2005 he was a memberof the
Indonesian Democratic Party Struggle and also won election to become mayorof
Surakarta. Jokowi won admittance to Gadjah Mada University in Yogyakarta and

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graduated with a degree in forestry engineering.With Jokowi’s work he was very
effective in reducing crime, which attracted foreign tourists. He also served a second
term as mayorwith a 90% vote and was ranked the 3rd
best mayorin the world by the
internationalCity Mayors Foundation. In 2014 the PDI selected Jokowi to be a
candidate forthe Indonesian presidentialelection. He won with 53% vote on July 9.
As a part of his presidentialplan he made statements to clamping down on corruption
and attemptingto attract more foreign direct investment to the country,along with
his nine-point plan to improve public services, implementing land reforms,
developing more-affordable housing,and helping the poor.
Indonesia still faces the darkness of corruption,drug smuggling,and human rights
issues throughout its country. Jokowi faces media back lash due to his stand for
capitalpunishment. There have been accusations ofblackmail within the political
structure and Indonesia has been regarded as the most corrupt government ofall.
Economics
Indonesia was ranked 105th
for economic freedom forthe 2015 index.It score has
decreased by 0.4 points since last year. This decline is reflected on business freedom,
the controlof governmentspending,and monetary freedom.There may have been a
decline in some areas such as freedom from corruption and labor freedom.Indonesia
has seen a 5.8% growth overthe last year.

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Indonesia majorexports contribute to theireconomy some ofthese exports are from
its generous natural resources such as; crude oil, natural gas, tin, copper, and gold.
And some of their key exports include machinery and equipment,chemicals, fuels,
foodstuff,electrical appliances, plywood,rubber and textiles. Indonesia has seen a
6.5% increase and sees approximately $1 trillion in revenue from their major exports.
Although Indonesia’s expected GDP growth has already been reduced from 5.6% to
5.2% it is still expected thatthey will still continue to develop.
Indonesia has one of the largest economies in South East Asia and is a memberof the
G-20.Although they have a great success in theireconomy Indonesiastill has an
unemployment rate of 7%, which means that a 7th
of its population in living below the
poverty line. Minimum wage is approximately $100 (USD) a month,which totals to
about $1200 (USD) a year. As of 2014 11% of the population lives in relative poverty
and 28 million live in absolute poverty.
Indonesia is working hard towards growing
a strongereconomy to compete in the
global economy.They’re working on
increasing the minimum wage for the
average workerin hopes to become more
attractive as an FDI destination.It’s been
said that investors shouldn’t overlook the
country with what they have to offer in the
labor intensive industry.Although the
governmentis working hard towards
bettering the minimum wage and attracting
investors Indonesian’s are not happy.
Approximately 76% on Indonesian citizens are dissatisfied with theirjobs.
Legal Climate
The judicial system consists of several types of courts all under the oversight of the
Supreme Court (MahkamahAgung) Indonesia in different from most common courts
because they don’t apply the principle of precedents. Most disputesappearbefore the
courts of generaljurisdiction such as the State Court (Pengadilan Negeri).There are
approximately 250 courts throughout ofall Indonesia each with its own jurisdiction.
The High Court (Pengadilan Tinggi) is the district court of appealand hears the
appeals from the State Courts. In the event of a cassation appeal,which is a final

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appealfrom lower courts, the Supreme Court will hear such appeals. The Supreme
Court can also hear case reviews in the event that new evidence justifies a new
hearing. CommercialCourt, established in 1988, handles bankruptcy and insolvency
applications and has the ability to extend jurisdiction to othercommercialmatters. In
the event that there is an appealfrom the CommercialCourt the Supreme Court will
oversee that appeal. Any administrativelaw cases filed against the governement are
heard by the State Administrative Court (Pengadilan Tata Usaha Negara).
Indonesia’s biggestconcern is the high violent crime rate.In 2014 11,776 violent
crimes were reported in the city of Jakarta most of those being aggravated assaults and
burglaries. Crime rates have decreased overthe years due to the ongoing work of the
Indonesian NationalPolice (INP).Although they have worked hard towards reducing
violent crimes that are occurring in the cities of Indonesia little has been done
surrounding the organized crime occurring.Organized crime is responsible for most
of the illegal logging/fishing,human trafficking,sales of illicit and counterfeit drugs,
corruption and othermajor problems. The prosecution has been unsuccessful in
capturing those committing these crimes because of the corruption that continues
with government officials. Since Indonesia has a high Muslim rate crime always
increases before the Ramadan because ofthe need to giving family members presents
for the Eld-Al-Fitri holiday.
Social Climate
The Indonesian Constitutionallows for freedom of religion. Indonesia has the largest
Muslim population with 88%.The remaining 12% worship Protestantism,
Catholicism, Hinduism,Buddhism,and Confucianism.Much of Indonesia’s culture is
influenced by religion. Art forms such as dance dramas ofthe Java and Bali are
influenced from Hindu mythology. The demographic ofIndonesian citizens goes as
follows; Javanese 45%, Sundanese 14%,Madurese 7.5%,CoastalMalays 7.5% and the
remaining 26% is other.

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Indonesia ranked 14 out of 151 countries on the Happy Planet Index reflecting
medium life expectancy,69.4years, medium levels of well-being and low ecological
footprint.Despite the stats surrounding happinessand life expectancy a large portion
of Indonesian citizens live poorly 11% of the population lives in relative poverty and
28 million live in absolute poverty.
Indonesia is very traditionaland because of this tradition they celebrate multiple
festivals throughout the year. Some of those festivals are; Bali Spirit Festival, Sanur
Village Festival, Eid ul Fitr, Kuta Karnival.
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